Syria's central bank needs true reform, not cosmetic change

The consequences have been far-reaching. Western governments—including the United States and the European Union—sanctioned the Central Bank for facilitating corruption, supporting al-Assad's military efforts, and enabling networks tied to repression. These sanctions have also blocked personal financial transactions into Syria, preventing many in the diaspora from sending remittances to their families—an economic lifeline for countless households.

The urgent need for independence

An independent Central Bank is not a luxury; it is a necessity for a functioning economy. Autonomous central banks are better positioned to prioritise long-term economic stability over short-term political gains. They can resist reckless monetary policies, maintain discipline, and build public trust in the financial system.

In Syria's current transitional context, securing the Central Bank's independence is particularly urgent, given HTS's prominent role in the caretaker government. HTS's designation as a terrorist organisation by numerous international actors has raised concerns among foreign governments and investors, complicating efforts to ease sanctions or attract investment.

Shielding the Central Bank from HTS influence is therefore essential. Ensuring that the institution operates independently and transparently could help alleviate fears that it might be exploited as a financial tool by a leadership with a controversial history. Achieving this will require robust internal mechanisms to insulate the bank from any political or military group, along with oversight structures that inspire confidence among Syrians and the international community.

Establishing independence could also accelerate the process of lifting sanctions. By severing ties with any political or military authorities—past or present—the Central Bank could demonstrate its commitment to reform and serving the Syrian people. Transparent policies, public reporting, and accountability mechanisms would send a powerful message to international actors that the institution is being rebuilt as a force for economic justice and stability.

Interim steps toward a long-term solution

Achieving full independence for the Central Bank may ultimately require decisions beyond the scope of the current transitional leadership. Nevertheless, immediate steps can and should be taken. The caretaker body could issue directives to ensure the bank operates autonomously and transparently during this transitional phase, laying the groundwork for more permanent reforms under future authorities.

These interim measures could pave the way for targeted sanctions to be lifted, allowing the Central Bank to reconnect with the global financial system. Such changes would ease the flow of remittances, unlock access to humanitarian funds, and attract investments essential for reconstruction and economic recovery.

An independent Central Bank could help stabilise the currency and foster investment. It could also promote economic justice by prioritising the needs of ordinary Syrians over the entrenched interests of elites.

Transparency is equally critical. The Central Bank must publish regular updates on monetary policies, release detailed financial reports, and establish mechanisms for public accountability. These measures are vital to rebuilding trust in an institution that has long been compromised. By prioritising these reforms now, even under transitional authorities, Syria can ensure they become foundational to the country's future governance.

For Syria, achieving Central Bank independence is not merely an economic necessity—it is a moral imperative. It offers an opportunity to break with a legacy of corruption and misuse, rebuild public trust, and create a financial system that serves all Syrians.

Dr Sabirin's leadership has the potential to play a role in this transformation, but real progress will require bold reforms and unwavering commitment from all sectors of Syrian society. Only then can the Central Bank fulfil its potential as a cornerstone of stability and prosperity for Syria's future.